SEC v. Robert A. Helms, et al., Case No. 1:13-cv-01036-LY (W.D. Tex.). On December 6, 2013, the SEC announced it obtained an asset freeze and other emergency relief in an alleged Ponzi scheme. According to the SEC, Robert A. Helms and Janniece S. Kaelin offered investments through Vendetta Royalty Partners, a business they controlled. The offering documents provided to investors said that more than 99 percent of the investment funds would be used to buy profitable oil and gas royalty interests. In reality, Helms and Kaelin invested only 10 percent of the proceeds and the returns on the investments were negligible. The SEC alleges that Helms and Kaelin had Vendetta Royalty Partners make millions of dollars in so-called partnership income distributions to investors. They used money from newer investors to make the distributions to earlier investors. The SEC also alleges that some offering documents misled investors about Helms’s oil-and-gas experience claiming he had significant industry experience. In reality, his oil-and-gas experience came from operating Vendetta Royalty Partners. According to the SEC, Helms and Kaelin also failed to tell investors about litigation against them and companies they
control. They allegedly lied about the performance of the oil-and-gas royalty investments they managed. Lastly, they failed to tell investors that Vendetta Royalty Partners was behind on its line of credit. In addition, the SEC charged Deven Sellers and Roland Barrera with illegally selling investments for Helms and Kaelin without being registered with the SEC. They also allegedly misled investors about the sales commissions and referral fees they were receiving. The SEC charged the defendants with violating Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Rule 10b-5. The SEC also charged Sellers and Barrera with violating Section 15(a) of the Exchange Act. In addition to the emergency relief obtained, the SEC seeks permanent injunctions, disgorgement, and civil monetary penalties.